China s industrial carbon dioxide emissions in manufacturing subsectors and in selected provinces

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1 China s industrial carbon dioxide emissions in manufacturing subsectors and in selected provinces Hongyou Lu China Energy Group Energy Analysis and Environmental Impacts Department Environmental Energy Technologies Division Lawrence Berkeley National Laboratory One Cyclotron Road, MS 90R4000 Berkeley, CA United States of America HYLu@lbl.gov Lynn Price China Energy Group Energy Analysis and Environmental Impacts Department Environmental Energy Technologies Division Lawrence Berkeley National Laboratory One Cyclotron Road, MS 90R4000 Berkeley, CA United States of America LKPrice@lbl.gov Keywords emissions inventory, industrial energy saving, manufacturing subsectors, China Abstract In 2009, China announced a goal to reduce its carbon dioxide intensity ( /unit of gross domestic product) by % by 2020 from the 2005 level. In 2011, China established a goal of reducing its intensity by 17 % during the 12th Five-Year Plan period ( ). Five provinces and eight cities have been selected to pilot low-carbon activities and are required to establish local-level emissions inventories. The industrial sector dominates the country s energy-related emissions, using two thirds of the total energy consumption. A better understanding of China s industrial energy use and emissions at the sub-sectoral and provincial levels can assist researchers and decision-makers in identifying the largest areas of energy-saving and emission-reduction potential. However, previous studies have largely focused on China s energy use and emissions at an aggregated level. Based on publicly-available information, this paper estimates industrial energy-related emissions for each manufacturing subsector at the national level and in twelve provinces, including: Chongqing, Guangdong, Hebei, Henan, Jiangsu, Liaoning, Shaanxi, Shandong, Shanghai, Shanxi, Sichuan, and Xinjiang. This paper first explains data availability issues and discusses the methodology as well as conversion factors used for the emissions calculations. This paper then presents the results of the calculation of the carbon intensity of fuel and electricity for each manufacturing subsector and identifies the largest - emitting sub-sectors in the selected provinces. In addition, three provinces are highlighted, illustrating that economic and energy structure play an important role in the industrial emissions within provinces. Finally, this paper discusses how to further improve carbon inventories at the sub-sectoral level and summarizes the findings of this study in light of China s current domestic carbon inventory efforts. Introduction In 2009, China announced a goal to reduce its carbon dioxide intensity ( /unit of gross domestic product) by 40 to 45 % by 2020 below the 2005 level. In 2011, China s announced a 2015 carbon intensity reduction target of 17 % for the 12 th Five- Year Plan period ( ). In March 2011, the National Development and Reform Commission (NDRC) of China selected five provinces (Guangdong, Liaoning, Hubei, Shaanxi, and Yunnan) as well as eight cities (Tianjin, Chongqing, Shenzhen, Xiamen, Hangzhou, Nanchang, Guiyang, and Baoding) to pilot low-carbon activities. The piloted low carbon development zones were tasked with developing low-carbon development plans, establishing supporting policies for a low-carbon economy, and establishing greenhouse gas data collection and management systems. In China, the industrial sector consumed approximately 70 % of total energy use and emitted 72 % of the energy-related emissions in 2010, while in the U.S. and most developed countries the share of industrial energy consumption is considerably lower. Figure 1 shows China s historical emissions by sector, in comparison with U.S. emission in China s industry also heavily relies on the use of coal. In 2008, less than 50 % of the country s coal consumption was used in the power sector; the remaining 50 % was consumed by industry directly (NBS, 2009). Industry is the key sector focus ECEEE 2012 SUMMER STUDY on Energy efficiency in industry 283

2 Lu, Price 3. MATCHING POLICIES AND DRIVERS 8,000 China 8,000 US 7,000 7,000 6,000 Transport Commercial Residential Industry 6,000 5,000 5,000 Mt CO2 4,000 4,000 3,000 3,000 2,000 2,000 1,000 1, Figure 1. China s Energy-Related Carbon Dioxide Emissions ( ). Note: Industry on the chart includes construction and agriculture. Industry used in the text does not include construction or agriculture. Sources: NBS, 2011; EIA, on in order to have an impact on China s energy and emission trajectories. The industrial sector includes a variety of manufacturing subsectors, some of which are quite energy-intensive. To understand how energy is consumed in industry and which sectors have the largest emissions, it is necessary to analyze the industrial sector at the sub-sectoral level. Provinces in China differ a lot as well. Although many provinces are industry-focused, there are significant variations among their manufacturing sectors. For example, one province may have a large iron and steel industry, while another province may be a large exporter of telecommunication equipment. Understanding the industrial energy use and emissions at the provincial level can help identifying the largest potentials for increasing energy efficiency and mitigation emissions. In this paper, energy use and emissions of manufacturing subsectors for the selected provinces, including Chongqing, Guangdong, Hebei, Henan, Jiangsu, Liaoning, Shaanxi, Shandong, Shanghai, Shanxi, Sichuan, and Xinjiang, are calculated and analyzed. The purposes of this study are providing a transparent calculation and identifying the largest energy-consuming and -emitting industrial subsectors in the selected provinces. Data Availability The two key resources for national energy consumption data in China are the China Statistical Yearbook and the China Energy Statistical Yearbook, both of which are published annually by the National Bureau of Statistics (NBS) of China. The China Statistical Yearbook includes data and information on all sectors and areas in the economy, while the China Energy Statistical Yearbook provides more detailed information on energy use in all relevant sectors and industries. Provincial energy data are drawn from the provincial statistical yearbooks (SYB) published by each province. All the selected provinces published statistical yearbooks annually, and some of them are available on-line. For instance, the recent Jiangsu Statistical Yearbooks (2009 and 2010) can be accessed online (Jiangsu Statistics Bureau, 2009 and 2010). However, although statistical yearbooks for provinces are available, not all the provinces provide energy data at the manufacturing sub-sectoral level. Six of the twelve selected provinces Henan, Chongqing, Xinjiang, Shaanxi, Liaoning and Shanxi have energy use by fuel for each industrial subsector in their statistical yearbooks. Three provinces Shandong, Hebei, and Guangdong only have aggregated total energy use by industrial subsector. The other three provinces Jiangsu, Sichuan, and Shanghai do not provide any energy use data by industrial subsector in their statistical yearbooks. Table 1 summarizes the data sources and data availability for calculating emissions in the manufacturing sector for China and each of the selected provinces. Without knowing the energy use of industrial subsectors, it is not possible to calculate emissions. As no energy data are available from Jiangsu, Shanghai, and Sichuan, this study only calculates the emissions of the other nine provinces. The selected provinces are mostly concentrated in the north and central China, with one province (Xinjiang) in the northwest, and another (Guangdong) in southern China. Figure 2 shows the locations of the selected provinces. Scope of Industrial Subsectors The National Bureau of Statistics (NBS) in China has established standards for categorizing industrial subsectors (NBS, n.d.). For example, Cement Manufacturing (NBS 3011) is under the category of Cement, Limestone and Gypsum Manufacturing (NBS 301), which is under the category of Manufacture of Non-metallic Mineral Products (NBS 30). The energy consumption of each subsector is reported based on this type of categorization. The energy use data reported in the Energy Statistical Yearbook and provincial statistical yearbooks are only for energy consumption at the two-digit level of industrial subsector, e.g., Manufacture of Non-metallic Mineral Products. Based on the NBS categorization, the Industry Sector includes: Mining and Quarrying, Manufacturing, and Electric Power, 284 ECEEE 2012 SUMMER STUDY on Energy efficiency in industry

3 3. MATCHING POLICIES AND DRIVERS Lu, Price Table 1. Data Sources and Data Availability. National/Province Data Source Data Availability Year of Data Total Energy Use Energy Use by Fuel China China Energy SYB 2009 Yes Yes 2008 Chongqing Chongqing SYB 2009 No Yes Guangdong Guangdong SYB 2009 Yes (ST) No Hebei Hebei SYB 2009 Yes (ST) No Henan Henan SYB 2009 Yes (ST) Yes Jiangsu Jiangsu SYB 2009 No No Liaoning Liaoning SYB 2009 No Yes Shaanxi Shaanxi SYB 2009 Yes (ST) Yes Shandong Shandong SYB 2009 Yes (ST) No Shanghai Shanghai SYB 2009 No No Shanxi Shanxi SYB 2009 Yes (ST) Yes Sichuan Sichuan SYB 2009 No No Xinjiang Xinjiang SYB 2008 Yes (ST) Yes 2007 ST: data provided only in standard coal equivalents. Heilongjiang Xinjiang Tibet Gansu Qinghai Yunnan Inner Mongolia Ningxia Shaanxi Sichuan Guizhou Guangxi Shanxi Henan Hubei Hunan Hebei Anhui Jiangxi Beijing Fujian Liaoning Zhejiang Jilin Shanghai Hainan Figure 2. Geographic Locations of Selected Provinces. Note: Medium dark color = selected provinces with data; dark color = selected provinces with no data available; light color = provinces that are not included in this study. ECEEE 2012 SUMMER STUDY on Energy efficiency in industry 285

4 Lu, Price 3. MATCHING POLICIES AND DRIVERS Gas and Water Production and Supply. For the purpose of this study, the calculation of emission is only undertaken for the Manufacturing sector. Methodology For provinces that provide detailed energy use by fuel for each manufacturing subsector (Chongqing, Henan, Liaoning, Shaanxi, Shanxi and Xinjiang), subsectoral emissions were calculated based on the following equation: Subsectoral Emissions = Physical Amount of Fuel Use Low Heating Value of Corresponding Fuel Emission Factor of Corresponding Fuel For provinces that only provide aggregated energy use for each industrial subsector (Hebei, Guangdong and Shandong), emissions were calculated based on national average emissions per unit of energy used in that subsector, as: Subsectoral Emissions = Total Energy Use by Industrial Subsector National Average Emissions per Unit of Energy Used of Corresponding Industrial Subsector This calculation is solely based on emissions from fuel combustion and does not include process-related emissions. Conversion Factors This study uses the low heating values published by NBS for different types of fuel. NBS published 2008 national energy consumption by industrial subsector by fuel in standard coal equivalents and physical units. Based on the reported values, 1 kilogram of coal equivalent (kgce) equals megajoules (MJ). NBS annually publishes low heating values for fuels, such as crude oil and raw coal, and these values normally do not change much over the years. However, for some fuels, such as coke oven gas and other gas, NBS provides a range of low heating values. To determine the exact low heating values, this study calculated the conversion factor by dividing the standard coal equivalent value by the physical unit value, based on the reported values in the 2009 China Energy Statistical Yearbook. Table 2 lists the low heating values used in this study. This study adopted the carbon coefficients reported in the Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories (IPCC, 1997a and IPCC, 1997b), as shown in Table 3, and assumed 100 % of carbon release from combustion. This study used the reported carbon coefficients of electricity consumption for provinces. NDRC published the carbon emission factors for thermal electricity by grid (NDRC, 2009) in 2009, as shown in Table 4. At the national level, carbon emission factors for electricity consumption are calculated Table 2. Low Heating Values by Fuel. Fuel Type Low Heating Values Unit Raw Coal 20,908 TJ/Mt Cleaned Coal 26,344 TJ/Mt Washed Coal 15,373 TJ/Mt Coke 28,435 TJ/Mt Coke Oven Gas 17,981 TJ/billion cubic meters Other Gas 8,418 TJ/billion cubic meters Other Coking Products 33,778 TJ/Mt Crude Oil 41,816 TJ/Mt Gasoline 43,070 TJ/Mt Kerosene 43,070 TJ/Mt Diesel 42,652 TJ/Mt Fuel Oil 41,816 TJ/Mt LPG 50,179 TJ/Mt Refinery Gas 46,055 TJ/Mt Other Petroleum Products 38,368 TJ/Mt Natural Gas 38,931 TJ/billion cubic meters Source: NBS, ECEEE 2012 SUMMER STUDY on Energy efficiency in industry

5 3. MATCHING POLICIES AND DRIVERS Lu, Price Table 3. Carbon Coef ficients by Fuel and Emission Factors by Fuel. Fuel Type Carbon Coefficient (t C/TJ) Coefficient (t /TJ) Coal Coke Coke Oven Gas Other Gas Other Coking Products Crude Oil Gasoline Kerosene Diesel Fuel Oil LPG Refinery Gas Other Petroleum Products Natural Gas Source: IPCC, 1997a and IPCC, 1997b. based on the energy inputs of electricity generation of Thus, this calculated carbon coefficients for electricity at the national level only takes into account the emissions from electricity generation. Emissions from transmission and distribution (T&D) losses are included by using the reported average T&D losses. The heat content per kilowatt hour (kwh) of electricity is kgce/kwh, or 3596 KJ/kWh, which is used to convert electricity to final energy consumption in this study. For coalfired power plants (with capacity no less than 6 MW), the average coal consumption (including self-use electricity) in 2008 was 345 gce/kwh (SERC, 2010). The average T&D losses in 2008 were 6.64 % (SERC, 2009). Thus, the average coal consumption per unit of electricity, including T&D losses, was kgce/kwh. The conversion factor from final to primary electricity is Some provinces also provided data for heating energy use in industrial subsectors. To calculate emissions from heating supply, the carbon coefficient of heat needs to be calculated. Based on the 2009 China Energy Statistical Yearbook, which provides energy use by fuel for heating supply, this study calculates emissions per tera-joule (TJ) from heating supply in provinces, based on the low heating values and carbon coefficients of fuels as described above. Results Subsectoral Emissions at the National Level In 2008, the manufacturing sector in China emitted 4,169 Mt, without including the emissions from electricity T&D losses. If emissions from T&D losses are included, the total emissions of the Chinese manufacturing sector in 2008 were 4,266 Mt. In terms of absolute emissions, the subsector of smelting and processing ferrous metals has the highest emissions, about 1,350 Mt (without including emissions from T&D losses) or 1,370 Mt (including T&D losses). Manufacturing chemical raw materials and products, as well as manufacturing of non-metallic products are the second and third largest subsectors, respectively, each emitting more than 650 Mt. The subsector of smelting and pressing of ferrous metals contributed the largest share, representing 32 % of the total manufacturing emissions. Manufacturing of raw chemical materials and chemical products, and the manufacturing of non-metallic mineral products each accounted for 16 % of the total. The percentages vary little when adding emissions from T&D losses. Figure 3 shows the breakdown of emissions (including emissions from T&D losses) by the manufacturing subsector in China in Table 5 shows emissions, final energy use, primary energy use, and industrial value-added for each of the manufacturing subsectors. Carbon emissions per final energy consumed ECEEE 2012 SUMMER STUDY on Energy efficiency in industry 287

6 Lu, Price 3. MATCHING POLICIES AND DRIVERS Table 4. Carbon Emission Factors for Power Grids in China (2009). Grid Name OM (t/mwh) BM (t/mwh) CM (t/mwh) Coverage of Provinces North Grid Beijing, Tianjin, Hebei Province, Shanxi Province, Shandong Province, Inner Mongolia Northeast Grid Liaoning Province, Jilin Province, Heilongjiang Province East Grid Shanghai, Jiangsu Province, Zhejiang Province, Anhui Province, Fujian Province Central Grid Henan Province, Hubei Province, Hunan Province, Jiangxi Province, Sichuan Province, Chongqing Northwest Grid Shaanxi Province, Gansu Province, Qinghai Province, Ningxia, Xinjiang Southern Grid Guangdong Province, Guangxi Province, Yunnan Province, Guizhou Province Hainan Grid Hainan Province Note: OM=Operating Margin, BM=Build Margin, CM=Combined Margin. CM is calculated as 50% OM and 50% BM. OM is the weighted average of operating margin emission factors from ; BM is the build margin emission factors by the end of Source: NDRC, Industrial subsectoral CO2 emissions in China (2008) Ferrous Metals (e.g., Steel) 32% Non- metallic Mineral Products (e.g., Cement) 16% Non- Ferrous Metals 7% Chemicals 16% Metal Products 2% Machinery 2% Transport Equipment 2% Food 2% Petroleum & Coking 6% Paper and Paper Products 2% Textiles 4% Figure 3. Manufacturing Emissions in China (2008) (including emissions from T&D losses). as well as primary energy consumed are calculated. China reported industrial value-added by manufacturing subsectors through The 2008 industrial value-added values are derived based on 2007 reported values and growth rates, in order to calculate economic carbon intensities. The China average results show that the manufacturing of plastics, metal products, and communication equipment have the highest emissions per unit of final energy consumed, at about 0.17 tonne of /GJ in However, overall, carbon coefficients ( /final energy consumed) of the majority of the 288 ECEEE 2012 SUMMER STUDY on Energy efficiency in industry

7 3. MATCHING POLICIES AND DRIVERS Lu, Price Table 5. Emissions by Manufacturing Subsector in China (2008). Manufacturing Emissions from Final Energy Use (including emissions from T&D losses) Final Energy Use Primary Energy Use Industrial Value- / Final Energy Added (2008) Consumed / Primary Energy Consumed / Value-Added Mt TJ TJ Million RMB tonne CO tonne CO (2005 RMB) 2 /GJ tonne /GJ 2 /10,000 RMB (2005 yuan) Processing of Food From Agricultural Products , , , Food manufacturing , , , Beverage , , , Tobacco 6 42,857 69, , Textile 155 1,100,442 1,881, , Textile Wearing Apparel, Footw ear, and Caps , , , Leather, Fur, Feather and Its Products 10 66, , , Timbers, Wood, Bamboo, Rattan, Palm and Straw Products , , , Furniture 4 31,774 55,957 66, Paper and Paper Products ,102 1,139, , Printing, Reproduction of Recording Media 9 55, ,803 70, Articles for Culture, Education and Sport Activity 5 35,720 68,790 59, Petroleum, Coking, Processing of Nucleus Fuel 256 3,006,586 3,300, , Chemical Raw Material and Chemical Products 690 6,403,537 8,317, , Medicines , , , Chemical Fiber , ,486 74, Rubber , ,875 96, Plastic , , , Non-metallic Mineral Products 671 6,274,997 7,633, , Ferrous Metals 1,370 12,651,628 15,210, , Non-ferrous Metals 278 1,734,391 3,474, , Metal Products , , , General Purpose Machinery , , , Special Purpose Machinery , , , Transport Equipment , , , Electrical Machinery and Equipment , , , Communication Equipment, Computers and Other Electronic Equipment , , , Measuring Instrument and Machinery for Cultural Activity and Office Work 7 43,410 89, , Artw ork, and other Manufacture , ,835 91, Recycling and Disposal of Waste 1 9,891 17,836 18, subsectors are in the range of tonne /GJ, with petroleum processing being the lowest. More variance is seen among manufacturing subsectors when using economic carbon intensity indicators. Ferrous metal manufacturing (e.g., steel-making) has the highest emission per unit of industrial value-added, at about 16 tonne /10,000 RMB (2005 RMB), indicating China s steel making remains in the stage of producing low valueadded but energy-intensive steel products. Non-ferrous metal manufacturing and chemicals production have higher intensities as well, at about 13 tonne /10,000 RMB (2005 RMB), and 9 tonne /10,000 RMB (2005), respectively. Subsectoral Emissions at the Provincial Level Since the provincial energy consumption of industrial subsectors is reported in final energy consumption values, the emissions per unit of final energy consumption, as presented Table 5, were used for calculating provincial subsectoral emissions, when detailed fuel use data were not available. Provincial emissions by industrial subsectors of all the selected provinces are presented in Table 6 and Figure 4. Provincial emissions for Chongqing, Henan, Liaoning, Shaanxi, Shanxi, and Xinjiang were calculated based on energy use by fuel. emissions for Hebei, Guangdong, and Shandong were calculated based on national average subsectoral emissions per terajoule (TJ). Note that the results provided in this table do not account for emissions from T&D losses. In Henan Province, the majority of emissions are from five subsectors, including processing of petroleum, coking and nuclear fuel; chemicals production; smelting and pressing of ferrous metals; smelting and pressing of non-ferrous metals; and manufacture of non-metallic mineral products. Each of the five subsectors accounted for 15 % of the total manufacturing emissions in Henan in 2008 (see Figure 5). In Shaanxi Province, manufacturing of raw chemical materials and chemical products is the largest emitting subsector, representing 26 %. The other four largest subsectors are processing of petroleum and coking (23 %), smelting and pressing of non-ferrous metals (14 %), manufacture of non-metallic mineral products (13 %), and smelting and pressing of ferrous metals (11 %). The chemical sector dominated Chongqing s manufacturing emissions, representing 43 % of the total manufacturing emissions in Chongqing in Manufacturing of non-metallic mineral products, smelting and process of ferrous-metals and manufacturing of transport equipment also contributed significantly, with 22 %, 10 % and 8 % of the total emissions, respectively. In Xinjiang Province, which has rich oil and natural gas resources, processing petroleum and coking is the largest and dominant subsector, accounting for 59 % of the total manufac- ECEEE 2012 SUMMER STUDY on Energy efficiency in industry 289

8 Lu, Price 3. MATCHING POLICIES AND DRIVERS Table 6. Subsectoral Emissions (without T&D Losses) in the Selected Provinces in 2008 (Mt ). Henan Shaanxi Chongqing Xinjiang Liaoning Shanxi Guangdong Shandong Hebei Manufacturing Total Processing of Food From Agricultural Products Foods Beverage Tobacco Textiles Textile Wearing Apparel, Footwear, and Caps Leather, Fur, Feather and Its Products Timbers, Wood, Bamboo, Rattan, Palm and Straw Products Furniture Paper and Paper Products Printing, Reproduction of Recording Media Articles for Culture, Education and Sport Activity Petroleum, Coking, Processing of Nucleus Fuel Chemical Raw Material and Chemical Products Medicines Chemical Fiber Rubber Plastic Non-metallic Mineral Products Ferrous Metals Non-ferrous Metals Metal Products General Purpose Machinery Special Purpose Machinery Transport Equipment Electrical Machinery and Equipment Communication Equipment, Computer and Other Electronic Equipment Measuring Instrument and Machinery for Cultural Activity and Office Work Artwork, and other Manufacture Recycling and Disposal of Waste Sources: Statistical Yearbooks for selected provinces, 2008 and 2007; IPCC, 1997a; IPCC, 1997b; NBS, 2010; NDRC, 2009; SERC, 2009; SERC, Notes: data for Xinjiang; 2008 data for other provinces. 2. Detailed breakdown of energy use by fuel for each industrial subsector in Guangdong, Shandong and Hebei are not available. National averages of CO2 emission intensities were applied to these three provinces. 290 ECEEE 2012 SUMMER STUDY on Energy efficiency in industry

9 3. MATCHING POLICIES AND DRIVERS Lu, Price Figure 4. Emissions of Industrial Subsectors in Selected Provinces (without T&D losses, 2008). ECEEE 2012 SUMMER STUDY on Energy efficiency in industry 291

10 Lu, Price 3. MATCHING POLICIES AND DRIVERS Ferrous Metals 15% turing emissions. The subsector of smelting and pressing of ferrous metals is the second largest emitting subsector, or 13 % of the total. Chemicals and non-metallic mineral products are the other two main industries. Liaoning Province had the earliest discovered oil field in China and has a clustered steel industry; therefore, it is not surprising to see that emissions from processing of petroleum and coking, as well as from smelting and pressing of Non- ferrous Metals 15% Non- metallic Mineral Products 15% Textile 3% Chemical Raw Material and Chemical Products 15% Paper and Paper Products 4% Petroleum, Coking, Processing of Nucleus Fuel 15% Figure 5. Emissions (without T&D Losses) of Manufacturing Sectors in Henan Province (2008). Electrical Machinery and Equipment 6% Metal Products 5% Non- ferrous Metals 3% Ferrous Metals 7% Communication Equipment, Computer and Other Electronic Equipment 11% Non- metallic Mineral Products 18% Textile 7% Paper and Paper Products 5% Petroleum, Coking, Processing of Nucleus Fuel 6% Chemical Raw Material and Chemical Products 6% Plastic 6% Figure 6. Emissions (without T&D Losses) of Manufacturing Sectors in Guangdong Province (2008). ferrous metals are the highest, with shares of 38 % and 33 %, respectively. emissions of manufacturing sectors in Shanxi are also similarly concentrated in a few sectors, including processing of petroleum, coking and nuclear fuels (50%), smelting and pressing of ferrous metals (24 %), manufacturing of raw chemical materials and products (11 %), and smelting and pressing of non-ferrous metals (8 %). The structure of subsectoral emissions in Guangdong Province differs greatly from other resource-rich provinces, as illustrated in Figure 6. Although manufacturing of non-metallic mineral products, ferrous and non-ferrous metals and metal products together still contributed 32 % of total manufacturing emissions in 2008, a larger portion of emissions were from other light industries or higher value-added industries, such as manufacturing of communication equipment, computer, and electronic equipment (11 %), textiles (7 %), manufacturing of electrical machinery (6 %), plastic (6 %), and paper (5 %). Because Shandong Province has many large industries, such as steel and cement, its emissions in the manufacturing sector are mostly from a variety of subsectors: smelting of ferrous metals (19 %), manufacturing of raw chemical materials and products (18 %), manufacturing of non-metallic mineral products (13 %), smelting of non-ferrous metals (8 %), processing of petroleum and coking (8 %), textile industry (6 %) and paper (6 %). For Hebei Province, the largest emitting subsector is smelting and pressing of ferrous metals, accounting for 63 % of the total. Manufacturing of chemicals and non-metallic mineral products represented 10 % and 9 % of the total manufacturing emissions in Hebei in Discussion One of the main barriers for calculation of provincial level emissions is data availability. Not all provinces provide energy data at the manufacturing subsectoral level, and even fewer provinces provide energy use by fuel. This poses a challenge in estimating provincial emissions. For example, Jiangsu Province, which is much more active in the area of industrial energy efficiency than other western provinces, does not publish subsectoral energy data in its latest statistical yearbook. Guangdong Province does have energy consumption data for each subsector; however, only coal and electricity consumption are provided in addition to aggregated energy use in standard coal equivalent unit. Limited data availability poses difficulties for calculation of physical and economic carbon intensities at the subsectoral level. NBS reports production data for key industrial products every year; however, reported energy data are not well in-line with production data. Energy consumption data are only reported at the two-digit manufacturing subsectoral level, without breaking down to the product level. Although some industrial associations report energy use and production for certain industrial products (e.g., cement production and energy use is reported annually by the China Cement Association), data reported in a collective and systematic manner for industrial products are needed for calculating physical carbon intensities. In the U.S., the Energy Information Administration 292 ECEEE 2012 SUMMER STUDY on Energy efficiency in industry

11 3. MATCHING POLICIES AND DRIVERS Lu, Price (EIA) conducts the Manufacturing Energy Consumption Survey (MECS) every four years, with the most recent 2010 MECS survey conducted in The 2006 MECS surveyed industrial establishments, and allowed EIA to estimate their energy use for 21 three-digit industrial subsectors, 50 industry groups and industries. Economic carbon intensities by manufacturing subsectors are derived in this paper based on reported 2007 industrial value-added and growth rates. China stopped reporting industrial value-added by subsector in 2008 in the China Statistical Yearbook which poses further challenges for development of economic indicators in the future. Physical and economic carbon intensities are often used for benchmarking, for comparison to historical performance, or to the performance of other sectors and other countries, in order to identify the largest areas of mitigation potentials. Without sufficient data, such benchmarking potential analyses are difficult to undertake. The use of transparent conversion factors is important for making calculations. This study is based on conversion factors used by NBS (for the low heating values) and the Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories (for the carbon coefficients). The electricity conversion from final to primary is based on the 2008 conversion efficiency of coal-fired power plants. National average T&D losses of 2008 are used for all provinces in the study. Electricity carbon emission factors for different provinces are from the NDRC s grid emission factors, which are calculated based on the 2006 IPCC Guidelines for National Greenhouse Gas Inventories. To further improve this study, provincial conversion factors (such as T&D losses and heating values) could be used, if available. Conclusion National policies have been established in China to reduce economic energy and carbon intensities, and at the provincial level local activities have been actively conducted, including publishing more detailed energy data for manufacturing subsectors in provincial yearbooks and developing greenhouse gas emission inventories based on IPCC methodologies. This paper aims at providing transparent estimates of emissions at the manufacturing subsectoral level based on publicly available information in China, to identify key subsectors with the largest carbon emissions, and to understand the carbon emissions distribution across subsectors in different provinces, in light of China s efforts to develop low carbon economies. The ferrous metals, petroleum, chemicals, and non-metallic mineral products subsectors are the largest contributors of manufacturing emissions at the national level. Subsectors of ferrous metal and non-metallic mineral manufacturing have the highest emissions per unit of industrial value-added, indicating these two subsectors produces low value-added but energy-intensive products. Emissions from manufacturing of textiles, and paper and paper products are high in China as well. Each of the studied provinces has a slightly different industrial subsector structure in terms of emissions, but most of the selected provinces manufacturing emissions are concentrated in a few energy-intensive subsectors, i.e., ferrous metals, chemicals, petroleum and coking, non-metallic mineral products. Guangdong Province, which differs greatly from others, has a more diversified structure of emissions that are from light industries or higher value-added industries. References Energy Information Administration (EIA), U.S. Energy-Related Carbon Dioxide Emissions, August 18, Intergovernmental Panel on Climate Change (IPCC), 1997a. Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories: Reference Manual (Volume 3). Intergovernmental Panel on Climate Change (IPCC), 1997b. Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories: Workbook (Volume 2). Jiangsu Statistics Bureau, 2009 and Jiangsu Statistical Yearbook 2009 and Available at: gov.cn/jstj/jsnj/2009/tjnj.htm, jsnj/2010/tjnj.htm. Accessed on April 20, National Bureau of Statistics (NBS), China Energy Statistical Yearbook China Statistics Press, Beijing, China. National Bureau of Statistics (NBS), China Energy Statistical Yearbook China Statistics Press, Beijing, China. National Bureau of Statistics (NBS), China Energy Statistical Yearbook China Statistics Press, Beijing, China. National Bureau of Statistics (NBS), n.d. Standard for Industry Classification C: Manufacturing Industry. Accessed on Nov 11, P pdf National Development and Reform Commission (NDRC), 2009: Notice of 2009 Emission Factors of regional power grid in China, July 3, WebSite/CDM/UpFile/File2334.pdf Provincial Statistical Yearbooks in Chongqing, Guangdong, Hebei, Henan, Liaoning, Shaanxi, Shandong, Shanxi and Xinjiang. State Electricity Regulatory Commission (SERC), W pdf State Electricity Regulatory Commission (SERC), htm Acknowledgements This work was supported by the Institute for Industrial Productivity through the U.S. Department of Energy under Contract No. DE-AC02-05CH ECEEE 2012 SUMMER STUDY on Energy efficiency in industry 293